State Rep. Banks to stand trial on loan fraud charges

Detroit — State Rep. Brian Banks will stand trial on charges he applied and received a credit union loan under fraudulent means.

The Democrat from Harper Woods is accused of using false documents to try to obtain $7,500. He received $3,000 after initially not being approved.

Judge Deborah Langston of the 36th District Court told Banks and his attorney, Ben Gonek, on Tuesday there was evidence the lawmaker wasn’t truthful when he obtained the loan from the Detroit Metropolitan Credit Union on East Jefferson.

The owner of IHI Consultants in Farmington Hills, Banks’ long-time friend, testified during Banks’ preliminary examination he had asked her to create a phony paycheck stub on her computer in June 2010.

“He was trying to get a loan for his (bar review) exam,” said the woman, whose name Langston ordered the media not to release.

The woman testified she also provided Banks him with a fraudulent employment letter stating he was a “research attorney” for her 5-year-old company. The business owner also said she used a fictitious name and signature of a ghost employee for paperwork that was faxed over to the credit union the same month.

The woman received immunity from prosecution as part of her testimony against Banks. She was interviewed by an FBI agent about her case early last year.

Pauline Foreman, a retired loan officer for the credit union which has been renamed Diversified Members Credit Union, testified the banking institution received an application from Banks on June 29, for the loan and the credit loan asked for a second pay stub to complete the application.

Foreman said Banks was approved for a $3,000 loan on July 1 after she received two pay stubs and other paperwork that showed Banks’ salary and the letter from IHI Consultant. Diversified eventually sued Banks and the loan was paid off.

Oronde Patterson, an attorney with the attorney general’s office, asked Langston to bind Banks over on the charges which include uttering, publishing and obtaining a loan under false pretenses, saying Banks “intended to defraud and cheat the bank.”

Under questioning by Gonek, an FBI agent said the complaint against Banks was not initiated by the credit union.

Banks, who did not comment after the hearing, remains free on $5,000 bond. His next court date is Aug. 23.

Gonek told reporters after Banks’ arraignment in June that the charges against his client were politically motivated and he alleged Banks was targeted because of his vote on key issues such as the Detroit Public Schools’ financial bailout by the state and a controversial insurance program, called D Insurance, promoted to Detroiters.

The charges “ were filed right before the primary election,” Gonek said. “This is close to the most ridiculous case I’ve ever seen.”

Before Tuesday’s hearing, a heated exchange took place between Banks’ attorney and Langston.

Gonek asked Langston to remove herself from the proceedings saying the judge had called Banks a “prick” during a legislative meeting last year at 36th District Court and that Banks did not want Langston overseeing the preliminary examination.

“There was a heated confrontation between you and (Banks) and he questioned your ability to be fair,” Gonek told Langston.

The judge fired back saying: “I never called you or Mr. Banks a prick. You made that up. I have nothing against Mr. Banks. He’s just another defendant.”

The judge denied Gonek’s request. Gonek then threatened not to take part in the preliminary examination after Langston also refused his request to delay Tuesday’s hearing so he could discuss his concerns about the judge with the chief judge of the 36th District Court.

Gonek later said he would file a judicial complaint about Langston.

Banks has eight prior felonies from 1998 to 2004 for writing bad checks and credit card fraud and faces up to life in prison as a habitual financial crimes offender if convicted of the new charges.

Tuesday’s case moves to trial just one week after Banks survived a Democratic primary in the 1st House District, which covers Harper Woods, Grosse Pointe Woods, Grosse Pointe Shores and a portion of northeast Detroit.

Banks won about 45 percent of the vote in last Tuesday’s primary, defeating defense attorney Pamela Sossi and four lesser known opponents.

Banks faces Republican William Broman of Grosse Pointe Woods in the Nov. 8 general election.